The new potential drugs have a completely different action than the most commonly prescribed anti-diabetic, Metformin, which acts on the liver to reduce glucose production
They target a protein receptor known as PPARgamma found in fat tissue throughout the body, either fully or partially activating it in order to lower blood sugar by increasing sensitivity to insulin and changing the metabolism of fat and sugar.
"Type two diabetes is characterised by resistance to insulin with subsequent high blood sugar which leads to serious disease. It is usually associated with poor lifestyle factors such as diet and lack of exercise," said John Bruning, from University of Adelaide.
"It's highly desirable for people to come off insulin injections and instead use oral therapeutics," he said.
In a study published in the Journal of Medicinal Chemistry, researchers describe 14 different versions of a drug which partially activates PPARgamma were produced.
Partial activation can have the benefit of fewer side- effects than full activation.
The original drug, INT131, is currently being tested in clinical trials in the US but some of the versions produced at the University of Adelaide have increased potency compared to the original, with the potential to further improve the treatment of type 2 diabetes.
In another study published in the journal BBA-General Subjects, researchers used X-ray crystallography to demonstrate for the first time exactly how a potential new drug, rivoglitazone, binds with the PPARgamma receptor.
Rivoglitazone fully activates PPARgamma but has less side effects than others with this mode of action.
"Showing how this compound interacts with its target is a key step towards being able to design new therapeutics with higher efficiencies and less side-effects," said Harinda Rajapaksha, from Flinders University in the Australia.